The speech can be streamed here
Excellencies and distinguished participants in the St. Petersburg Forum.
This economic forum brings together the Russian government, businesses, and international participants with the goal of reducing barriers and encouraging economic progress. I am pleased to speak with all of you.
Today’s discussions take place during a time of unprecedented challenge.
My first visit to this city was in 1975, also a period of great economic and geopolitical challenge. Inflation was rising rapidly due to the 1971 devaluations of world currencies and the oil price shock. Geopolitical relationships were changing fast. The Cold War threatened everyone.
Even so, I remember the anticipation in Leningrad in the summer of 1975 for the joint Soyuz-Apollo mission. The famous handshake in space (MЕ́CTO BCTPЕ́ЧИ: КО́СМОС) symbolized the world’s hope and longing for an era of freedom, peace, and international progress.
Since then, Russia and its neighbors in Asia, eastern Europe, and the Arctic – and indeed people around the world – have changed profoundly. Most people are freer and more prosperous. Technology connects us and adds to our lives and awareness of others in ways we could never imagine. Progress in space and under the seas has been remarkable.
Yet all these advancements face setbacks and unique risks. As in 1975, we find ourselves facing global challenges on many fronts, including COVID-19, climate change, animosity within and across borders, and a deepening inequality in which billions of people live in poverty and unsustainable debt.
As a Russian proverb says¾Беда́ (никогда́) не прихо́дит одна́¾Trouble never comes alone. When that happens, each of us must tackle our troubles openly and cooperatively. For the World Bank Group, we’re working toward good development outcomes for all – with financing, expertise, advocacy and, I can assure you, good will for people in every country. Cooperative efforts are at the core of our mission to alleviate poverty and boost shared prosperity.
Next year marks the 30th anniversary of the World Bank’s engagement with Russia. The relationship has evolved from Russia as a borrower to Russia as an influential shareholder, donor, and development partner. I strongly welcome global support – and Russia’s – for the International Development Association (IDA), the World Bank’s fund for the poorest 75 countries. I am very pleased that Russia has committed to providing financial support for IDA20, the ongoing replenishment. A strong and successful IDA20 can make a major contribution to helping the poorest countries recover from the pandemic and work toward green, resilient, and inclusive development.
I’ll mention just two others of our current work areas. First, helping Russia contribute to global public goods, including its efforts toward a green transition that will benefit Russians and people around the world. And second, exchanging development knowledge. This is particularly useful as people in developing countries around the world look for solutions to create jobs, invite investment, increase agricultural production and water quality in sustainable ways, build quality infrastructure, and do much better in protecting nature and the environment.
During our three decades of engagement, the World Bank Group contributed to Russia’s transition to a market economy and upper middle-income status. We played an important role in support of institution building and reform, from the establishment of the federal treasury system to the digitization of customs and taxation. To support and strengthen the private sector, IFC, the private sector arm of the World Bank Group, committed over $8.5 billion between 1993 and 2015 and provided advice in areas of corporate governance, business environment, market transition and competitiveness. Those of you traveling through Pulkovo Airport to attend this Forum benefited from our support for its rehabilitation through a public-private partnership that leveraged 1.2 billion euros in private investment.
More generally, our twice-yearly Russian Economic Report has been providing a robust and independent analysis of the Russian economy since 2001, and we now stand ready to support Russia’s focus on raising household incomes and making the transition to more sustainable energy and environmental practices.
I’d like to briefly comment on the economic context of today’s St. Petersburg forum and then turn to vaccines, debt, and climate. I welcome the rebound in the global economy, but it remains deeply uneven. There’s a concentration of income and assets at the top, with billions of people left out of the progress. Developing countries remain vulnerable due to lack of safe vaccines, healthy food, medicine, and infrastructure. Women, young and low-skilled workers face the hardest challenges and barriers.
I’ve just come from Helsinki where I met with Finland’s President and with economic, finance and development ministers from Nordic and Baltic countries. The meetings were productive, giving us a chance to discuss pathways to a better world. Topics included the importance of broad distribution of effective COVID-19 vaccines; the many challenges facing the world’s poorest countries, which now include food insecurity; and climate issues, including the particular challenges facing countries with northern latitudes or Arctic borders.
VACCINES
Expanding vaccine access is an immediate priority. The World Bank’s vaccination programs to help low- and middle-income countries purchase and distribute vaccines will reach over 50 countries and $4 billion of financing by mid-year. We have further vaccine financing ready to commit, but supply constraints and country capacity are binding for many emerging markets and developing economies.
Some countries will clearly have excess doses of effective vaccines very soon, and I’ve urged them to release their surplus doses in a transparent manner, with clear delivery schedules to countries with adequate distribution plans in place.
DEBT
In many countries, working toward a sustainable recovery also means reducing the high external debt burden and the interest rates on it. High debt payments continue to divert scarce resources away from urgent needs, including health, education, nutrition, and climate action. We need to work collectively in ways that provide comparable treatment among all creditors, including full burden sharing with the private sector and China’s large creditor agencies.
CLIMATE
It’s also critical to make progress on climate issues. This was a major topic in my Helsinki meetings and is prominent in both the G7 and G20 agendas this year. I’m encouraged by Russia’s engagement on climate-related issues and the step up in its efforts to curb gas flaring.
The World Bank Group has put forward a Climate Change Action Plan that recognizes the importance of integrating climate and development and making best use of the available climate finance. Countries need to find ways to transition to much lower greenhouse gas emissions and take steps to adapt to climate changes.
We’re looking forward to working with Russia to conduct a systematic and in-depth analysis of its climate related efforts as one of the first partners in our new Country Climate and Development Report initiative. For Russia, it will be important to achieve dramatic improvements in energy efficiency, reduced use of coal, manufacturing that is less carbon intensive, and land use practices that improve the efficiency of fertilizer and reduce the pollution of rivers and oceans.
With its strengths in science and engineering, Russia could make important contributions to technological innovation and manufacturing capacity to support lower-carbon, net-zero development in Russia and around the world.
The World Bank Group will be spending and investing much more under our climate plan and looking for ways that this financing can achieve the most impact on greenhouse gases and adaptation. Nature-based solutions are an important part of this approach.
We’re actively engaged with many of Russia’s neighbors on both development and climate. We’re working to improve energy efficiency, build transportation corridors that connect new trading partners, restore the environment, diversify agriculture, and build resilient digital infrastructure. Poland recently announced that it will add support to rural communities during its energy transition as it ends government support to coal-fired boilers in single family homes.
Conclusion
Even as the recovery takes hold in some parts of the world, many of the world’s poor still live without electricity or clean water. For them, the pandemic weakened the chances for advancement, creating lasting damage to their health and resulting in lost months and even years of vital education and skills development. The armed confrontations and disruptions to rule of law in several parts of the world are a major obstacle to development, and it is incumbent on all parties to find peaceful solutions.
In conclusion, I can assure you that the World Bank Group is working in overdrive to improve people’s lives. There has never been a more urgent time to look across the global community for common ground and new resources. Our responses to the pandemic, climate, and inequality will be defining choices of our age, requiring nations and people to work together toward a brighter future.
СПАСИ́БО ЗА ВА́ШЕ ВНИМА́НИЕ! Thank you.
